The social health maintenance organization (S/HMO) provides an innovative approach to organizing, financing and delivering health care services in an attempt to control resource use while providing high-quality care. S/HMOs differ from traditional Medicare TEFRA HMOs by providing acute and chronic care services with coordinated, comprehensive case management under one capitation payment. Since HMO's with TEFRA-risk contracts are available to nearly 50% of the elderly in this country, evidence of a S/HMO's ability to provide more cost effective care for either the general elderly population or the population at high risk for institutionalization, could have a dramatic effect on the provision of long term care benefits. The purpose of the proposed study is to compare resource use and health outcomes for enrollees in a S/HMO with enrollees in a TEFRA HMO that is identical to the S/HMO except for the provision of long-term care and case management benefits. The measures of resource use include number of inpatient admissions and inpatient days, home visits and days in skilled nursing facilities, emergency room visits, and physician office visits. Health outcomes will be measured by the enrollee's self-reported health and functional status. The setting for the study is the S/HMO offered by Medicare Partners (dba Seniors Plus) and Seniors, a TEFRA HMO offered by Group Health, Inc. in Minneapolis - St. Paul, Minnesota. Analyses are based on all S/HMO enrollees (N=2,451) and a random sample of TEFRA HMO enrollees (n=5,237). Data for the analyses come from claims files and a mailed survey. Statistical techniques are proposed which correct for the non-experimental research design.